BTC Bears to Target Sub-$29,000 on ETF Uncertainty and Fed Jitters

Key Insights:

• On Sunday, BTC enjoyed a bullish end to the week, gaining 0.97% to end the day at $30,190.
• SEC appeal-related chatter and hopes of the SEC approving one, some, or all the BTC ETFs provided support.
• However, the near-term technical indicators remained bearish, signaling a return to sub-$29,000.

On Sunday, bitcoin (BTC) gained 0.97%. Reversing a 0.36% loss from Saturday, BTC ended the week down 0.63% to $30,190. Despite the bullish session, BTC fell short of $30,500 for the third consecutive day.

Bitcoin (BTC) Price Action

This morning, BTC was down 0.51% to $30,036. A mixed start to the day saw BTC rise to an early high of $30,211 before falling to a low of $30,014.

Daily Chart

The Daily Chart showed BTC sitting below the $30,750 – $31,250 resistance band. However, BTC remained above the 50-day ($29,491) and 200-day ($26,862) EMAs, signaling bullish momentum over the near and longer term. Notably, the 50-day EMA continued to pull further away from the 200-day EMA, affirming the near-term bullish trend.

Looking at the 14-Daily RSI, the 50.26 reading signaled a moderately bullish outlook. Aligning with the EMAs, the RSI signals a move through $30,500 to give the bulls a run at the $30,750 – $31,250 resistance band. However, a fall through the 50-day EMA ($29,491) would bring sub-$29,000 into view.

4-Hourly Chart

Looking at the 4-Hourly Chart, BTC remains below the $30,750 – $31,250 resistance band and fell through the 50-day EMA ($30,138), signaling a bearish session. However, BTC held above the 200-day EMA ($29,867), sending bullish longer-term price signals.

Significantly, the 50-day EMA narrowed on the 200-day EMA, signaling a return to sub-$29,000. However, a BTC move through the 50-day EMA ($30,138) would support a breakout from $30,500 to target the $30,750 – $31,250 resistance band.

The 14-4H RSI reading of 49.35 indicates a moderately bearish stance, with selling pressure outweighing buying pressure. Significantly, the RSI aligns with the 50-day EMA, signaling near-term bearish momentum and a return to sub-$29,000. A fall through the 200-day EMA ($29,867) would bring sub-$29,000 into play.

BTC Remained Stuck in a Rut on ETF and SEC Appeal Uncertainty

It was a quiet Sunday session. There were no crypto events to move the dial, leaving investors to consider the chances of the SEC approving one, some, or all of the Spot BTC ETF applications.

The crypto market was apprehensive after the SEC formally accepted the ETF applications last week, kickstarting the formal review process. Previously, the SEC has declined numerous spot BTC ETF applications, citing inadequate investor protection and anti-fraud mechanisms.

Regulatory uncertainty also remained a headwind as investors monitor SEC appeal-related chatter. After the news of the SEC planning to appeal the Judge Torres ruling on Programmatic Sales, investor hopes for new legislation to roll out an appropriate crypto regulatory framework waned, with Democratic lawmakers seemingly unwilling to support a regulatory framework.

Financial Innovation and Technology for the 21st Century Act, saying,

“Instead of focusing on pressing Farm Bill issues, House Republicans are sprinting to provide a handout to crypto exchanges, Wall Street, and Silicon Valley venture capitalists at the expense of American consumers and retail investors.”

Before the SEC v Ripple Court ruling, the US administration and the blue side of the aisle have been scathing about the digital asset space, with the collapse of FTX, Terra Labs, Celsius, and others leading to increasing scrutiny. However, the US administration remained silent on the Court ruling that could materially alter the US digital asset landscape.

The Day Ahead

It could be a busy day for BTC and the broader market. SEC v Ripple chatter, ETF updates, and Binance and Coinbase (COIN)-related news will need consideration.

Investors will also need to track the US economic calendar, with private sector PMIs in focus today. While investors have ignored recent US economic indicators, the Fed will deliver its pre-summer interest rate decision on Wednesday. Better-than-expected service PMI numbers could fuel bets on a more hawkish Fed, a bearish scenario for riskier assets.